Improved Oversight Needed at
Middleburgh Central School District

The Middleburgh Central School District failed to solicit competitive bids or quotes for approximately $650,000 worth of purchases and did not perform criminal background checks on some employees. The district may have also inappropriately paid its prior superintendent more than $64,000, according to an audit released today by State Comptroller Thomas P. DiNapoli.

“These are serious errors and Middleburgh taxpayers should be asking some serious questions,” DiNapoli said. “Now more than ever, taxpayers can’t afford any government waste. From accounting practices to safety measures, the district needs to make major improvements in how it does business.”

DiNapoli’s auditors found that the district may have inappropriately paid the former superintendent $34,582, including $32,650 for health insurance premiums; an excessive separation payment totaling $1,750; and $182 in dental reimbursements. Poor record keeping prevented auditors from determining if the school board had approved provisions of the superintendent’s contract that had been amended to provide these benefits.

Additionally, the district did not maintain adequate leave records for the superintendent to justify paying him $31,750 for unused sick, personal and vacation time, including the $1,750 separation payment noted above. In fact, auditors found the superintendent maintained his own leave records.

DiNapoli’s auditors also discovered the district’s treasurer performed inaccurate bank reconciliations and a total of $3.1 million of accounting record errors.

During the audit period, July 1, 2006 to May 13, 2008, the district’s purchasing agent did not approve 78 orders for more than $2.5 million in purchases. Staffers didn’t seek bids for seven purchases for electricity, gasoline, computer paper and library equipment totaling approximately $600,000 that required competitive bidding under state law. Other purchases for about $53,000 of goods required quotes, but staffers did not obtain them.

Examining the records of 18 district employees, four sports officials and three health center employees, auditors found that none of the health center employees or sports officials were subjected to criminal background checks, potentially putting students and fellow employees at risk. Background checks were not completed on two of the 18 district employees.

In examining the district’s computer systems, auditors found staff members were adding, modifying, and deleting user access accounts without documentation. That led to delays deactivating old accounts, former employees having active financial software accounts as well as the creation of two financial accounts for one employee.

The audit recommends that:

the board review the payments to the prior superintendent and seek reimbursement if they were not proper;

the board ensure that the terms of any employment contracts and amendments are properly approved and documented;

the business administrator provide adequate oversight and review of the treasurer’s work; and

the district ensure that all employees and contractors expected to have contact with students have criminal background checks.

District officials generally agreed with the audit’s recommendations and have begun implementing them.

School District Accountability
In order to improve accountability of the state’s schools, DiNapoli’s office will audit all of New York’s school districts and Boards of Cooperative Educational Services by 2010. The State Comptroller’s office has completed 665 school audits and more than 60 are currently underway.